Adam D'Augelli, Partner at True Ventures, reflects on the benefits of joining an early-stage venture fund over a structured incumbent firm.
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“If you're going to join a venture fund, joining one that is new, where they have lots to do with people that you like, and you're aligned with their values, is super important.”
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More from Adam D'Augelli
AssertionNot checkable as stated
D'Augelli: VCs cannot practically increase ownership in top breakout companies
“And so our, you know, call it 20 to 25% at the beginning. If we do everything right, we'll own between 17 and 20% at outcome. But I think it's very difficult over time with success to continue to buy ownership.”
Adam D'AugelliDec 16, 2019▶ 13:1020VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
Insight
D'Augelli: In highly uncertain markets, knowing more leads to worse decisions
“As an aside, there's an awesome academic paper called Investing in the Unknown and Unknowable, which argues that in markets with many unknowns and things you cannot know, Knowing more actually leads to worse decisions for an investor, and rather they should fo…”
Adam D'AugelliDec 16, 2019▶ 28:0720VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
Disclosure
True Ventures targets 20% seed ownership with $2M median checks
“And so, you know, to dive in on True, we manage funds of roughly three hundred million, and really focus on leading the first round of institutional capital, usually pre-seed or seed, with investments of 500 K to three and a half million, targeting 20 to 25% i…”
Adam D'AugelliDec 16, 2019▶ 6:4520VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
“We have a meaningful bias towards priced equity rounds with a single lead who have really deep pockets. Somewhat self-serving, but we also think it's the best way to go build very important companies.”
Adam D'AugelliDec 16, 2019▶ 11:4020VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
Disclosure
D'Augelli: True Ventures' best investments like Ring and Splice looked weird
“I would say in most of our successful companies over time, they were not perceived as successful in the beginning. Things like Ring or Splice are companies that Today, I think people are like, that's, those are really interesting businesses, but there were kin…”
Adam D'AugelliDec 16, 2019▶ 13:2820VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
Disclosure
D'Augelli: Half of Ring's products were defective when True Ventures invested
“50% of their products at that point didn't work.”
Adam D'AugelliDec 16, 2019▶ 24:4920VC: How To Think Through Portfolio Construction and The Business Model of VC, Why You Cannot Grow Ownership In Your Best Companies Over Time & How To Make The Space for Serendipity To Strike in VC with Adam D'Augelli, Partner @ True Ventures
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